Laws that reverse the legal burden

9.64     This section identifies a number of Commonwealth laws that place a legal burden on the defendant in respect of particular issues. Offences that reverse the legal burden of proof on an issue essential to culpability arguably provide the greatest interference with the presumption of innocence, and their necessity requires the strongest justification. Such laws, including deeming provisions in relation to serious drug offences, and directors’ liability for taxation offences, may warrant further review. Any such review should consider whether placing an evidential rather than legal burden on the defendant would be sufficient to balance the presumption of innocence with the legitimate objectives pursued by these laws.

Criminal Code

9.65     There are a number of provisions in the Criminal Code that place a legal burden on the defendant. These include terrorism offences, drug offences, child sex offences, and offences relating to unmarked plastic explosives.

Terrorism offences

9.66     Some terrorism offences impose a legal burden on the defendant. For the offence of membership of a terrorist organisation, it is a defence to prove that the defendant took reasonable steps to cease to be a member of a terrorist organisation as soon as practicable after the person knew that the organisation was a terrorist organisation.^[85]

9.67     Section 102.6 creates the offence of getting funds to, from, or for a terrorist organisation. A person will not commit an offence if they prove that the funds were received solely for the purpose of the provision of legal representation for a person in proceedings relating to terrorist organisation offences, or assisting the organisation to comply with Australian law.^[86] The Law Council of Australia (Law Council) submitted that it was unclear why the defendant should bear the legal and not the evidential burden on this issue, observing that ‘the justification for the departure is unclear in this case and may be unjustified’.^[87]

9.68     A review of counter-terrorism legislation by the Council of Australian Governments (COAG) recommended that ‘the legal burden in the note in subsection 102.6(3) be reduced to an evidential one’.^[88] This recommendation echoed similar recommendations made in 2006 by the Security Legislation Review Committee and the Parliamentary Joint Committee on Intelligence and Security.^[89]

Drug offences

9.69     The Criminal Code contains a series of deeming provisions in relation to the fault elements for a number of drug offences. For example, when the defendant is found to be dealing with a threshold ‘trafficable’ quantity of a controlled drug, the person is deemed or presumed to have the requisite intention or belief to have been either: trafficking in a substance;^[90] cultivating a plant for a commercial purpose;^[91] or manufacturing a substance for a commercial purpose.^[92]

9.70     The legal onus lies on the defendant to defeat these presumptions—that is, the defendant must prove, on the balance of probabilities, that they did not have the requisite intention or belief for the offence.

9.71     The drug offences in the Criminal Code were introduced in 2005,^[93] and were based on the Model Criminal Code, developed by the Model Criminal Code Officers Committee of the Standing Committee of Attorneys-General (MCCOC) after nationwide consultation.^[94]

9.72     However, the MCCOC did not recommend that presumptions placing the legal burden on the defendant be included in the Criminal Code. The MCCOC instead recommended that the defendant bear only an evidential burden in relation to the requisite intention. In making its recommendation, the Committee considered that

[t]he task of the prosecution is eased to the extent that guilt is presumed in the absence of evidence to the contrary. But testimony from the accused, other evidence or circumstances inconsistent with the inference of intent to traffic in the drug, will displace the presumption and require the prosecution to prove guilt beyond reasonable doubt.^[95]

9.73     It considered that a presumption placing an evidential burden on the defendant was an appropriate compromise between the needs of effective law enforcement and the presumption of innocence. The MCCOC observed:

Compromises which weaken or abandon the principle that individuals are innocent until proved guilty require compelling justification when the consequences of conviction are severely punitive, as they are in the trafficking offences … Though acceptance of the need for trafficable quantity presumptions involves a compromise, it is a compromise which preserves the principle that the prosecution must prove guilt whenever there is evidence which contradicts the presumption. There are compelling reasons against further dilution of the rule that individuals accused of crime are innocent until they are proved to be guilty.^[96]

9.74     The Law Council supported a review of the reversal of the burden of proof in these laws. Commentators have noted that such presumptions are ‘unique relative to most other drug trafficking threshold systems across the world, where deemed supply laws are explicitly avoided’.^[97]

9.75     One justification for the reversal of the burden of proof in these offences is the difficulties of proof faced by the prosecution. The Commonwealth Director of Public Prosecutions has stated that, without the reversal of the burden of proof on this issue, ‘the prosecution would face formidable difficulty in securing convictions’.^[98]

9.76     Heydon J in Momcilovic commented on the placement of the legal burden of proof on the defendant in relation to possession in the Drugs, Poisons and Controlled Substances Act 1981 (Vic). He noted that, while ‘unpalatable’, such placement facilitates

proof of possession much more than a simple placement of the evidential burden on the accused would. It increases the likelihood of the accused entering the witness box more than a reverse evidential burden would. That is because there is a radical difference between the two burdens. A legal burden of proof on the accused requires the accused to disprove possession on a preponderance of probabilities. An evidential burden of proof on the accused requires only a showing that there is sufficient evidence to raise an issue as to the non-existence of possession. The legal burden of proving something which the accused is best placed to prove like non-possession is much more likely to influence the accused to testify than an evidential burden, capable of being met by pointing to some piece of evidence tendered by other means and perhaps by the prosecution.^[99]

9.77     Such provisions have also been justified ‘under goals of delivering proportionality and effective responses to those who inflict widespread suffering—drug traffickers’.^[100] However, the proportionality of this response has been questioned:

the drug users who find themselves at the margins of the drug trafficking thresholds are most likely to be the more marginalised users (eg more unemployed and socially disadvantaged) … which reduces their capacity to successfully prevent an unjust sanction. … [I]t is known that an ‘unjustified conviction for dealing will often impose social and individual harms which far exceed the harm associated with the drug in question’.^[101]

Child sex offences outside Australia

9.78     The defendant bears a legal burden in relation to a number of defences to sexual offences against children outside Australia.^[102] Section 272.9(5) imposes a legal burden on a defendant to prove that they did not intend to derive gratification from a child being present during sexual activity. The Law Council submitted, in relation to this offence, that

[t]he gravity of the subject matter of the offence, coupled with the serious penalty it attracts, could have very serious consequences for a person charged with this offence. In such circumstances, it may not be appropriate that the only recourse available to a defendant is to discharge a legal burden.^[103]

Plastic explosives

9.79     The Criminal Code creates a number of offences in relation to trafficking in,^[104] importing or exporting,^[105] manufacturing^[106] or possessing^[107] unmarked plastic explosives. If no detection agent (a marking requirement for plastic explosives)^[108] is detected in a sample of an explosive when tested, a legal burden lies on the defendant to disprove that the plastic explosive breaches a marking requirement.^[109]

9.80     A legal burden is also placed on the defendant to establish a defence to charges relating to unmarked plastic explosives, including that he or she had no reasonable grounds for suspecting that the plastic explosive breached that marking requirement.^[110]

Taxation

9.81     The Taxation Administration Act 1953 (Cth) contains a number of provisions that reverse the burden of proof. The legal burden lies on the defendant to establish defences to the charges of making false or misleading statements,^[111] and incorrectly keeping records.^[112]

9.82     Additionally, s 8Y provides that when a corporation commits a taxation offence, a person who is concerned in, or takes part in, the management of a corporation shall be deemed to have committed the taxation offence. It is a defence to prove that the person did not aid, abet, counsel or procure the act or omission of the corporation concerned, and was not in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the act or omission of the corporation. The legal burden lies on the defendant to establish this defence.^[113]

9.83     The Australian Institute of Company Directors (AICD) expressed concern about s 8Y of the Taxation Administration Act, arguing that the legal burden on the defendant should be removed and ‘the normal principles of justice and fairness that apply to all other citizens prosecuted for criminal offences’ restored.^[114]

9.84     Provisions imposing personal liability for corporate fault may encourage greater transparency in management process, and improve accountability and performance standards of corporate officers. Such provisions ensure that ‘human agents of prohibited conduct will … face the legal ramifications of their acts and will not be able to abuse or hide behind the corporate structure’.^[115]

9.85     In 2009, COAG agreed to a set of principles relating to personal liability for corporate fault and developed guidelines for their application.^[116] The Principles stated that provisions that place an evidential or legal onus on a director to establish a defence that the director is not liable for corporate fault (for example, a defence to show that reasonable steps were taken to avoid committing the contravention) ‘must be supported by rigorous and transparent analysis and assessment, so as to clearly demonstrate why it is considered that such a provision is justified from a public policy perspective’.^[117] Relevant considerations for justification include where:

• there is a serious risk of potential significant public harm resulting from the offence;

• the size and nature of the penalties indicate a very serious offence; and

• the offence is a core element of the relevant regulatory regime.^[118]

9.86     The onus of proof on defendants in s 8Y of the Taxation Administration Act was not amended in the legislative response to the COAG principles, the Personal Liability for Corporate Fault Reform Act 2012 (Cth). Explanatory notes accompanying the Exposure Draft of the proposed amendments elaborated on this decision:

the Government has taken into account a range of factors outlined in the COAG guidelines, including the magnitude of harm that the offending conduct would likely cause, the effectiveness of corporate penalties in preventing this conduct and the availability of evidence to the prosecution and the director.

Section 8Y provides a defence to directors who can show, on the balance of probabilities, that they were not involved in the company’s offending. As such, section 8Y operates, in substance, as an accessorial liability provision. It would not be feasible to shift the burden and require the prosecution to prove a director’s involvement in the company’s offence, especially as such information could be peculiarly within the knowledge of the director.

As a matter of practicality a director would be in a significantly better position to be able to adduce evidence that shows they were not involved in the company’s offending rather than explicitly require the prosecution to establish their involvement.

The ATO relies on section 8Y to prosecute those directors who repeatedly and seriously neglect their company’s tax obligations. If the ATO is unable to prosecute these individuals, it could significantly undermine the public’s confidence in the fairness of the tax system and the ATO’s ability to enforce the law.^[119]

9.87     The AICD submitted that the ‘retention of this provision has not been sufficiently justified pursuant to the COAG approach. Further, and more importantly, no justification has been provided as to why it is appropriate to undermine the Rule of Law by deciding to retain this provision’.^[120] The Corporations Committee of the Business Law Section of the Law Council strongly endorsed the AICD’s submission.^[121] The Law Council also supported review.^[122]

Copyright

9.88     The Copyright Act 1968 (Cth) contains a number of criminal offences in relation to copyright infringement.^[123]

9.89     The Act creates a presumption in relation to proof of subsistence and ownership of copyright, providing that statements contained on the labels, marks, certificates or chain of ownership documents are presumed to be as stated, unless the contrary is established.^[124] It also includes presumptions relating to computer programs,^[125] sound recordings^[126] and films.^[127]

9.90     The presumptions relating to criminal offences in the Copyright Act were introduced by the Copyright Amendment Act 2006 (Cth). Provisions in the Copyright Act that provided that statements made on certificates and other documents were admissible in a prosecution as ‘prima facie evidence’ of the facts so stated were amended by the 2006 Act, and new presumptions relating to films and computer programs added.^[128]

9.91     The Explanatory Memorandum stated that amendments were intended to ‘strengthen’ the presumptions in the Act, and to ‘assist copyright owners and reduce costs in the litigation process’.^[129] It also stated that the aim was to introduce consistency with other, civil, presumptions in the Act. The Australian Digital Alliance and the Australian Libraries Copyright Committee submitted that presumptions in the context of criminal cases

circumvent a key safeguard in our justice system: that the onus is on the prosecutor or plaintiff to prove the liability of the accused or defendant to the relevant standard of proof. This principle is a key protection against unjustified incursions on personal liberty. It is troubling that the reason given for the introduction of some of the presumptions was ‘to assist copyright owners in the litigation process’. Provisions which make criminal liability for copyright infringement easier to prove act as deterrents to the use of copyright material, conceivably leading to self-censorship of what may very well be a legal use of material in given case. The result is a net loss of creative expression.^[130]

9.92     Commenting on similarly worded presumptions relating to civil copyright infringement proceedings, Luke Pallaras observed that

in some instances, a shift in the evidential burden may be sufficient to fulfil the policy goals of the presumption; but in other cases only a shift in the legal burden would suffice. For instance, where the purpose of a presumption is to prevent time and delay caused by establishing issues that are probabilistically likely to be the case (such as copyright subsisting in an alleged work, or the plaintiff’s ownership of copyright), only a shift in the evidential burden appears justified.^[131]

9.93     In contrast, the Commonwealth Director of Public Prosecutions supported a reversal of the legal burden, submitting to an inquiry into the amending Bill that the ‘presumption recognises that copyright is a highly technical area and marshalling the evidence necessary to prosecute matters is a difficult and lengthy process’.^[132]

9.94     The Guide to Framing Commonwealth Offences states that ‘presumptions have a similar effect to defences, and are only appropriate in certain circumstances’.^[133] The Senate Standing Committee for the Scrutiny of Bills (Scrutiny of Bills Committee) has stated that presumptions should be kept to a minimum and justification for them provided in the Explanatory Memorandum.^[134]

Other laws

9.95     A number of other laws reverse the legal burden of proof. For example, the defendant bears a legal burden to establish defences to a number of offences in the Migration Act 1958 (Cth). For the offence of arranging a marriage between other persons to assist a person to obtain permanent residence, it is a defence if the defendant proves they believed on reasonable grounds that the marriage would result in a genuine and continuing marital relationship.^[135]

9.96     Under the Great Barrier Reef Marine Park Act 1975 (Cth) the defendant bears the legal burden of proving that entry into a compulsory pilotage area was unavoidable.^[136] For the offence of an unauthorised vessel entering an area to be avoided under the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (Cth), the defendant bears a legal burden to establish a defence of unforseen emergency.^[137]

9.97     The Work Health and Safety Act 2011 (Cth) prohibits a person from being subjected to discriminatory treatment for exercising a function or right under the legislation, such as serving as a health and safety representative or raising a concern about work health and safety.^[138] The defendant bears the legal burden of proving that a prohibited reason was not the dominant reason for engaging in discriminatory conduct.^[139] The placement of the burden of proof on the defendant on this issue has been justified on the basis that ‘it will often be extremely difficult, if not impossible, for the prosecution to prove that the person engaged in discriminatory conduct for a prohibited reason’.^[140]

Bail

9.98     The presumption of innocence may be understood in both a broad and narrow sense.^[141] The narrower sense of the presumption of innocence refers to the principle that the prosecution should bear the burden of proof of guilt,^[142] and has been the focus of this chapter.

9.99     In its broader sense, the presumption of innocence encompasses the criminal process more generally, including the notion that ‘pre-trial procedures should be conducted, so far as possible, as if the defendant were innocent’.^[143] Procedures relating to bail engage the presumption of innocence in its wider sense.

9.100  The New South Wales Law Reform Commission has distinguished the use of the language of ‘presumption’ in the bail context from other criminal law contexts. It notes that ‘when the law speaks of a presumption, it is usually in relation to an issue of fact’. By contrast, presumptions relating to bail ‘do not concern proof of facts, but decision-making and the burden of persuasion’.^[144]

9.101  The Law Council submitted that Commonwealth laws that reverse the presumption in favour of bail ‘may undermine the presumption of innocence, as a key component of a fair trial’.^[145] Legal Aid NSW argued that ‘a reversal of the presumption in favour of bail effectively removes an important check and balance on the power and decision-making capacity of law enforcement officers’.^[146]

9.102  Examples of laws that reverse the presumption in favour of bail include s 15(6) of the Extradition Act 1988 (Cth), which requires that special circumstances must be established before a person remanded under the Extradition Act can be granted bail; and s 15AAof the Crimes Act 1914 (Cth), which reverses for terrorism offences the presumption in favour of bail.

9.103  In explaining the necessity for a presumption against bail in the Extradition Act,the Attorney-General’s Department stated:

The current presumption against bail for persons sought for extradition is appropriate given the serious flight risk posed by the person in extradition matters, and Australia’s international obligations to secure the return of alleged offenders to face justice in the requesting country. … The removal or substantial qualification of the existing presumption (which has been a feature of Australia’s extradition regime since the mid-1980s) may impede Australia’s ability to meet our extradition treaty obligation to return the person to the requesting country to face criminal charges or serve a sentence.^[147]

9.104  The Independent National Security Legislation Monitor has noted that the application of the ‘presumption against bail in terrorism trials to date demonstrates extreme unlikelihood of a person charged with a terrorism offence being released on bail (in almost all cases the accused will be detained for the protection of the community)’.^[148]

9.105  Reversing the presumption in favour of bail has been subject to criticism. In relation to the Extradition Act, the House of Representatives Standing Committee on Social Policy and Legal Affairs expressed its concern regarding the presumption against bail, and the justification for it:

The Committee does not doubt that bail is likely and rightly to be refused in the majority of extradition cases, and considers that this amendment will have little effect on the outcome of bail application in such cases. However, as a matter of principle, the Committee notes that it has not been convinced of the need for the Bill to prescribe a presumption either against or in favour of bail.^[149]

9.106  The Australian Human Rights Commission has identified the reversal of the presumption of bail for terrorism offences as a ‘disproportionate interference with the right to liberty under art 9 of the ICCPR as well as the presumption of innocence under art 14(2) of the ICCPR’.^[150]

Civil laws

9.107  In a civil claim, the burden of proof will generally lie on the plaintiff on all essential elements. As Walsh JA in Currie v Dempsey explained:

The burden of proof in the sense of establishing a case, lies on a plaintiff if the fact alleged … is an essential element of his cause of action, eg, if its existence is a condition precedent to his right to maintain the action.^[151]

9.108  A number of submissions discussed civil laws that place the burden of proof on some issues on the defendant.^[152] However, the ‘cardinal’^[153] common law principle examined in this chapter is that the prosecution should bear the onus of proof in criminal proceedings. Accordingly, this chapter has focused on criminal laws that reverse the legal burden of proof.

9.109  The distinction between civil and criminal proceedings may not always be clear. The ALRC’s 2003 report on civil and administrative penalties noted that the

traditional dichotomy between criminal and non-criminal procedures no longer accurately describes the modern position, if it ever did. The functions and purposes of civil, administrative and criminal penalties overlap in several respects. Even some procedural aspects, such as the different standards of proof for civil and criminal sanctions, are not always clearly distinguishable.^[154]

9.110  The Institute of Public Affairs observed that governments ‘increasingly regulate behaviour through the civil law, rather than the criminal law’.^[155] Professor Anthony Gray has noted the existence of ‘a broader debate regarding the ongoing utility of such a distinction, whether there should be recognised a “third category” of proceedings that are properly neither civil nor criminal, and the essence of what is and should be considered to be a crime’.^[156]

9.111  Where there is such a blurring of distinctions between criminal and civil penalties, careful scrutiny of any reversals of the burden of proof is merited. The Human Rights Committee has noted that civil penalty provisions

may engage the criminal process rights under articles 14 and 15 of the ICCPR where the penalty may be regarded as ‘criminal’ for the purpose of international human rights law. The term ‘criminal’ has an ‘autonomous’ meaning in human rights law. In other words, a penalty or other sanction may be ‘criminal’ for the purposes of the ICCPR even though it is considered to be ‘civil’ under Australian domestic law.^[157]

9.112  For the Human Rights Committee, matters to consider in assessing whether a civil penalty is ‘criminal in nature’ include: the classification of the penalty; the nature of the penalty, including whether it is intended to be punitive or deterrent in nature, and whether the proceedings are instituted by a public authority with statutory powers of enforcement; and the severity of the penalty.^[158]

Proceeds of crime

9.113  Some aspects of proceeds of crime laws may be considered to involve civil penalties that are criminal in nature. The Proceeds of Crime Act 2002 (Cth) (Proceeds of Crime Act)establishes a scheme to confiscate the proceeds of crime.^[159]

9.114  The Act provides for the making of an ‘unexplained wealth order’: an order requiring the person to pay an amount equal to so much of the person’s total wealth as the person cannot satisfy the court is not derived from certain offences.^[160] A court may make an unexplained wealth order if a preliminary unexplained wealth order^[161] has been made, and the court is not satisfied that the person’s wealth was not derived from an offence.^[162]

9.115  The burden of proving that the person’s wealth is not derived from an offence lies on that person.^[163] The person need not have been charged or convicted of any offence.

9.116  Gray has argued that civil forfeiture regimes are criminal in nature:^[164]

Such provisions typically allow forfeiture of the asset although the person who owns the asset has not been proven at the criminal standard to have committed a crime by which the asset was directly or indirectly obtained.^[165]

9.117  Section 179E was added to the Proceeds of Crime Act in 2010,^[166] with the rationale that,

[w]hile the Act contains existing confiscation mechanisms, these are not always effective in relation to those who remain at arm’s length from the commission of offences, as most of the other confiscation mechanisms require a link to the commission of an offence. Senior organised crime figures who fund and support organised crime, but seldom carry out the physical elements of crimes, are not always able to be directly linked to specific offences.^[167]

9.118  The reversal of the onus of proof in unexplained wealth orders has been said to be appropriate because ‘[d]etails of the source of a person’s wealth will be peculiarly within his or her knowledge’.^[168] However, the Scrutiny of Bills Committee was concerned about the ‘potential impact of such an onerous provision on a person’s civil liberties’.^[169]

9.119  The operation of the unexplained wealth provisions is subject to the oversight of the Parliamentary Joint Committee on Law Enforcement.^[170] That Committee may require law enforcement bodies to appear before it to give evidence.^[171] Additionally, the Commissioner of the Australian Federal Police must report to the Committee each financial year.^[172]

9.120  In an independent review of the Proceeds of Crime Act in 2006 Tom Sherman found that, while there was consensus among international law enforcement bodies about the appropriateness of a reversal of the burden of proof in unexplained wealth provisions,

it falls short of the wider consensus I believe is necessary to support the introduction of unexplained wealth provisions. Unexplained wealth provisions are no doubt effective but the question is, are they appropriate considering the current tension between the rights of the individual and the interests of the community? … On balance I believe it would be inappropriate at this stage to recommend the introduction of these provisions.^[173]

9.121  In contrast, in 2012, a Parliamentary Joint Committee on Law Enforcement Inquiry into unexplained wealth legislation concluded that,

in practice, it is difficult to conceive of scenarios by which an individual had significant amounts of unexplained wealth with no way of accounting for their legitimate accumulation, if that was in fact what had occurred … The committee is therefore of the view that, with appropriate safeguards, unexplained wealth laws represent a reasonable, and proportionate response to the threat of serious and organised crime in Australia.^[174]

9.122  The Law Council submitted to this Inquiry that traditional criminal court processes should apply in civil confiscation proceedings, ‘whereby the onus remains with the prosecution to establish that the property was unlawfully acquired’.^[175]